Key success factors can help you get to your destination.
When writing a business plan, it's crucial to identify what will make your business a success. Think of key success factors as the small towns you must pass through to reach your destination. If you don't consult a map to found out where those towns are, you may miss a turnoff and your destination. Key success factors, also known as critical success factors, keep you and your employees on track to make your business a success.
Measurable Key Success Factors
Increasing the sales of a product or service is a common key success factor, but it should be linked to a measurable goal, such as "sales of product X will increase by 30 percent in the fourth quarter." Measuring the outcome of the goals related to your key success factors is essential to keeping your business on target.
General Key Success Factors
Almost all businesses can benefit from having the key success factor "attract new customers." Decide how many new customers your business needs to succeed, and set a related goal, such as "increase walk-in traffic by 25 percent by offering samples at the door." Other examples of common key success factors are, "retain quality employees," "increase profit margin" and "increase customer satisfaction."
Regulatory Key Success Factors
Some businesses are subject to more regulation than others. Manufacturing facilities must comply with OSHA regulations, and they may want to develop a key success factor that addresses the company's compliance. For example, "Provide all employees with hazardous material training."
Industry Specific Key Success Factors
Key success factors should always be relevant to the business you are in. An example of an industry specific key success factor is "increase load factor relative to the industry average." This key success factor is specific to the airline industry, as referenced in "Airline Industry Key Success Factors" in the Graziadio Business Report. Fleet management is essential to airlines, limousine companies and taxi services, but it's not relevant to the development of computer games.
Temporal Key Success Factors
The key success factor "Build a manufacturing facility to produce 80 percent of inventory" is an example of what RapidBi.com calls temporal factors. According to the web site, temporal factors "relate to short-term situations, often crises. These CSF's may be important, but are usually short-lived." In this example, once the manufacturing facility is constructed and operational, the key success factor is no longer needed and can be replaced by a currently relevant one.
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